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Machine learning is a popular fraud-fighting technology, but models have a tendency to become less effective over time as criminals adjust their tactics. On Tuesday, ACI Worldwide Inc. said it’s taking a crack at that problem with a service that the company says can adjust automatically to changing fraud patterns.
The service, called Incremental Learning, also represents an industry first in terms of its breadth of industry coverage, says Naples, Fla.-based ACI. “We are the first vendor globally to roll out the new Incremental Learning technology across the merchants, payments, and financial services sectors,” said Fabian Gloerfeld, head of payments intelligence for ACI, in a statement. “The new capability is a realization of ACI’s multi-year investments and will further enhance our sophisticated fraud monitoring and prevention solutions.”
ACI says it conducted a 13-month test with data from three unnamed retail clients that indicated Incremental Learning models “maintained their performance” throughout the period. “Traditionally trained models,” by comparison, started losing effectiveness three months into the test.
The company has filed a patent application for Incremental Learning, which it says it is deploying in Proactive Risk Manager, a product for financial institutions and intermediaries, and ACI ReD Shield, used for e-commerce. “As fraudsters become more sophisticated, we need to continuously advance our models to beat them at their own game,” said Jimmy Hennessy, director of data science at ACI, in a statement.
In related news, survey results released Tuesday indicate that a majority of consumers continue to use digital payments despite fears about the security of the underlying platforms. The biggest reason appears to be that consumers find the platforms easier than carrying cash.
The survey, from online design firm Visual Objects, found that a majority of consumers in all age groups use some form of digital payment at least once a month. A majority of those aged 18 to 34, and 47% of those aged 35 to 54, use the platforms at least weekly. Some 983 U.S. users of digital-payment methods were included in the survey.
Yet fraud fears linger and could ultimately hamper usage. Ranking highest among these concerns is hacking, cited by 41% of the respondents. Some 16% cited simply “fraud,” a concern that ranked second. Concerns about transaction fees (14%) and overspending and debt (7%), trailed. Overall, some 69% of respondents expressed some doubts about the security of digital payments.
And, despite continued consumer usage, these concerns could not only hurt usage, but also adoption of new payment modes, suggests the survey report. “With data breaches at well-known companies becoming more frequent, people are prioritizing the protection of their personal and financial data,” says the report. “This presents a barrier to the adoption of mobile-payment technology.”
